Cboe gives transformed-feed vendors up to two years of distribution-fee relief

Cboe BZX’s Data Vendor Program offers up to two years of external distribution-fee relief to firms that transform exchange data and sell it to downstream distributors. The amended schedule, effective 28 September, distinguishes those vendors from brokers distributing quotes to their own trading clients.[1]

A qualifying vendor must not have received the relevant feed during the preceding 18 months, must identify itself publicly as a data vendor, and must be integrating or actively preparing to integrate the feed. Transformation can include aggregation, normalisation, enrichment or repackaging into a terminal, API or proprietary feed. The vendor must not maintain a brokerage relationship with the users to whom it distributes the feed and cannot qualify as an extranet service provider.[1]

Waiver period and continuing charges

The programme distinguishes data vendors from retail brokers. Cboe’s filing says a vendor’s primary business is transforming and redistributing market data to other distributors, whereas a broker’s principal activity is execution and account management. A broker that happens to display quotes to its own clients therefore does not become eligible simply by calling itself a vendor.[2][1]

The commercial logic is explicit. Cboe says depth products require more engineering, higher data volumes and more complex quality assurance than a top-of-book feed, which is why Premium and BZX Summary Depth receive the longer waiver. The benefit can be substantial—up to $300,000 of Premium external distribution fees over 24 months—but that arithmetic is a maximum nominal fee comparison, not a forecast of vendor savings after all other charges and build costs.[3][1]

Vendors should preserve the evidence that supports eligibility: the date they last received each feed, public marketing language, transformation design, downstream distributor list, revenue model and separation from brokerage relationships. Cboe may request an attestation and supporting documentation. The waiver starts when the feed is first received, so a vendor that begins before its commercial product is ready can consume part of the relief during development.[1]

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